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HomeMy WebLinkAbout97-3869 CivilCHERYL J. HORNE, Plaintiff Vo GENERAL ACCIDENT INSURANCE COMPANY, Defendant IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW NO. 97-3869 CIVIL TERM IN RE: DEFENDANT'S MOTION FOR SUMMARY JUDGMENT BEFORE HOFFER, P.J., HESS and OLER, JJ. ORDER OF COURT AND NOW, this ~'~day of August, 1998, after careful consideration of the motion for summary judgment filed on behalf of Defendant General Accident Insurance Company, and for the reasons stated in the accompanying opinion, Defendant's motion for summary judgment is DENIED. BY THE COURT, Samuel L. Andes, Esq. 525 North 12th Street Lemoyne, PA 17043 Attorney for Plaintiff Douglas B. Marcello, Esq. 305 North Front Street Post Office Box 999 Harrisburg, PA 17108-0999 Attorney for Defendant CHERYL J. HORNE, Plaintiff Vo GENERAL ACCIDENT INSURANCE COMPANY, Defendant IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW NO. 97-3869 CIVIL TERM IN RE: DEFENDANT'S MOTION FOR SUMMARY JUDGMENT BEFORE HOFFER, P.J., HESS and OLER, JJ. OPINION and ORDER OF COURT In this civil action, Plaintiff has brought suit against her insurer for payment of a claim under a homeowner's policy for losses stemming from an alleged theft. For disposition at this time is a motion for summary judgment filed on behalf of Defendant General Accident Insurance Company. Defendant contends that the action is time-barred by a statutorily mandated clause of the insurance policy requiring that all actions based upon the policy be commenced within one year of the loss. Plaintiff contends that the Defendant is estopped from relying upon the limitations clause in the contract. For the reasons stated in the accompanying opinion, Defendant's motion for summary judgment will be denied. PROCEDURAL HISTORY and STATEMENT OF FACTS According to the Plaintiff's complaint, Plaintiff in this action is Cheryl J. Home, an adult individual who resides at 301 Harmony Lane, Camp Hill, Cumberland County, Pennsylvania.~ Defendant is General Accident Insurance Company (GAIC), a business corporation with an office at 100 Corporate Center, Camp Hill, Cumberland County, Pennsylvania.2 Plaintiff Home commenced this action against Defendant GAIC on July 17, 1997 by filing a praecipe for writ of summons. Plaintiff filed a complaint on October 17, 1997. Defendant filed an answer with new matter on December 5, 1997, and Plaintiff's reply to Defendant's new matter was filed on June 17, 1998. On March 20, 1998, Defendant filed a motion for summary judgment, which is presently before the court. Additionally, an affidavit of Plaintiff has been filed of record. On or about January 29, 1996, $54,740.00 worth of jewelry and computer equipment were al!egedly stolen from the home of Plaintiff, Cheryl J. Horne.3 These items were, at that time, insured under a homeowner's policy purchased by the Plaintiff from GAIC, according to the complaint? One of the terms of the policy was a contractual limitation of actions provision, contained in Section I - Conditions of the contract: 8. Suit Against Us. No action can be brought unless the policy provisions have been complied with and the action is started within one year after the date of loss? Plaintiff's Complaint, Paragraph 1; Plaintiff's Affidavit Paragraph 1. Plaintiff's Complaint, Paragraph 2, Defendant's Answer, Paragraph 2. Plaintiff's Complaint, Paragraphs 4, 10. Plaintiff's Complaint, Paragraph 5. Plaintiff's Complaint, Paragraph 5; Defendant's Answer and New Matter, Exhibit A. 2 Plaintiff's affidavit states that, shortly before the alleged theft, she had contracted to purchase a new insurance policy from Lititz Mutual Insurance Company (Lititz).6 The agent from which the Plaintiff purchased the Lititz policy allegedly informed Plaintiff that his agent would contact GAIC in order to cancel the Plaintiff's preexisting homeowner's policy with GAIC.7 The aforementioned agent allegedly never took such action and the GAIC policy's coverage continued, according to Plaintiff's affidavit.8 After the alleged theft, Plaintiff filed a claim with Lititz, which was denied.9 According to Plaintiff's affidavit, the stated reason for the denial was Plaintiff' s continuing coverage under the GAIC policy.~° Plaintiff's affidavit indicates that she then filed a claim with GAIC in September of 1996.Il Plaintiff's affidavit asserts that she cooperated with Defendant in the processing of the claim, including her submission of two sworn statements to GAIC's representatives on November 18, 1996 and January 3, 1997.~2 After the passage of one year from the alleged incident of theft the Defendant continued to deal with the Plaintiff in processing her claim. Defendant's actions, according to the Plaintiff's affidavit, included a letter from Defendant's 6 Plaintiff's Complaint, Paragraph 7; Plaintiff's Affidavit Paragraph 2. 7 Plaintiff's Complaint, Paragraph 6; Plaintiff's Affidavit, Paragraph 2. 8 Plaintiff's Complaint, Paragraph 8. 9 Plaintiff's Complaint, Paragraph 7; Plaintiff's Affidavit, Paragraph 5. ~0 Plaintiff's Complaint, Paragraph 8; Plaintiff's Affidavit, Paragraph 5. ~ Plaintiff's Affidavit, Paragraph 5. ~2 Plaintiff's Affidavit, Paragraph 6. 3 counsel to Plaintiff's counsel seeking a release from Plaintiff in order to obtain Plaintiff's files from the Lititz Mutual Insurance Company? STATEMENT OF LAW Summary Jud_mnent. A motion for summary judgment is governed by the following Rule of Civil Procedure in Pennsylvania: RULE 1035.2 MOTION After the relevant pleadings are closed, but within such time as not to unreasonably delay trial, any party may move for summary judgment in whole or in part as a matter of law (1) whenever there is no genuine issue of any material fact as to a necessary element of the cause of action or defense which could be established by additional discovery or expert report, or (2) if, after the completion of discovery relevant to the motion, including the production of expert reports, an adverse party who will bear the burden of proof at trial has failed to produce evidence of facts essential to the cause of action or defense which in a jury trial would require the issues to be submitted to a jury. "[S]ubparagraph (2) [of the Rule applies where], the record contains insufficient evidence of facts to make out a prima facie cause of action or defense and, therefore, there is no issue to be submitted to a jury .... To defeat this motion, the adverse party must come forth with evidence showing the existence of the facts essential to the cause of action or defense." Committee Note, Pa. R.C.P. 1035.2. The purpose of this portion of the rule is 13 Plaintiff's Affidavit, Exhibit A. 4 obviously to protect a party against whom an essential allegation cannot be supported with evidence from the burden of going to trial in order to secure a resolution of the matter. See Eaddy v. Hamaty, __ Pa. Super. __, __, 694 A.2d 639, 643 (1997). Pennsylvania's Applicable Insurance Law Provision. In Pennsylvania, as a general rule a policy insuring property against fire, lightning or removal must contain, inter alia, a provision to the following effect: No suit or action on this policy for the recovery of any claim shall be sustainable in any court of law or equity unless all the requirements of this policy shall have been complied with, and unless commenced within twelve months next at~er inception of the lOSS.14 Pennsylvania courts have repeatedly upheld the validity of such a provision in insurance policies. See Fennell v. Nationwide Mutual Fire Insurance Company, 412 Pa. Super. 534, 542, 603 A.2d 1064, 1068 (1992) (describing the relevant precedents as an "unbroken line of authorities upholding the limitations clause prescribed by statute"); see also Petraglia v. American Motorists Insurance Company, 284 Pa. Super. 1, 4, 424 A.2d 1360, 1362 (1981) (collecting authorities). Such a clause will not be enforced, however, "when the conduct of the insurer constitutes a waiver or estoppel." Petraglia v. American Motorists Insurance Company, 284 Pa. Super. at 8, 424 A.2d at 1364. Absent such circumstances, such clauses will be given full effect by the courts. See Fennell v. Nationwide Mutual Fire Insurance Company, 412 Act of May 17, 1921, P.L. 682, § 506, as amended40 P.S. § 636 (2). 5 Pa. Super. 534, 542, 603 A.2d 1064, 1068 (1992); Petraglia v. American Motorists Insurance Company, 284 Pa. Super. 1, 4, 424 A.2d 1360, 1362 (1981). If in the course of the negotiations the company gave the plaintiff reasonable grounds for believing that the time limit would be extended or that such provision would not be strictly enforced, it could not subsequently insist on its strict enforcement without giving him a reasonable time thereafter to bring his action. McMeekin v. Prudential Life Insurance Company of America, 348 Pa. 568, 572, 36 A.2d 430, 432 (1944) quoted in Commonwealth v. Transamerica Insurance Company, 462 Pa. 268, 275, 341 A.2d 74, 77 (1975). A waiver need not be explicit but can be inferred from the insurer's recognition of liability or even the denial of the claim on other grounds. See Transamerica at 275, 341 A.2d at 77. The "existence of a material issue of triable fact which would support such an allegation [of waiver or estoppel]" is sufficient to defeat a motion for summary judgment. Petraglia v. American Motorists Insurance Company, 284 Pa. Super. 1, 9, 424 A.2d 1360, 1364(1981). Estoppel. "In order to apply the doctrine of equitable estoppel, the party to be estopped must have (1) intentionally or negligently misrepresented some material facts; (2) known or had reason to know that the other party would justifiably rely on the misrepresentation; and (3) induced the party to act to his or her detriment based on their justifiable reliance upon the misrepresented facts. One who asserts estoppel must establish these elements by clear, precise and unequivocal evidence." Allegheny County Hous. Auth. 6 V. Morrissey, __ Pa. Commw. __, __, 651 A.2d 632, 637 (1994) (citations omitted). "Equitable estoppel, a doctrine [of fundamental fairness,] acts to preclude one from doing an act different than the manner in which another was induced by word or deed to expect." Zitelli v. Dermatology Educ. And Research Found., 534 Pa. 360, 370, 633 A.2d 134, 139 (1993). "In order for the doctrine of estoppel to be applied in bar of a statute of limitations defense, fraud or concealment must necessarily be established. However, this does not mean fraud in the strictest sense encompassing an intent to deceive, but rather fraud in the broadest sense which includes an unintentional deception. It is not the intention of the party estopped but the natural effect upon the other party which gives vitality to an estoppel." Nesbitt v. Erie Coach Co., 416 Pa. 89, 96, 204 A.2d 473,476 (1964) (citations omitted). Whether a party has justifiably relied on another's actions is an issue of fact. See Carpenter and Carpenter v. City of. lohnstown, 146 Pa. Commw. 274, 605 A.2d 456, appeal denied__ Pa. __, 613 A.2d 1210 (1992). APPLICATION OF LAW TO FACTS In the case subjudice, the Plaintiff commenced the action more than one year after the date of loss. Under the above-cited law, the burden is upon the Plaintiff to provide a factual basis to support a finding of waiver or estoppel to avoid the consequences of the policy's limitations clause. Viewing the record in a light most favorable to the Plaintiff, the court believes that summary judgment is inappropriate in this case. A factual dispute exists herein as to whether the actions of Defendant GAIC constituted a waiver, apparent waiver or such other behavior as would induce a reasonable person to inaction. Since this court believes that this is not a case in which Defendant's right to summary judgment is clear and free from doubt at this time, the following Order will be entered: ORDER OF COURT AND NOW, this 7th day of August, 1998, after careful consideration of the motion for summary judgment filed on behalf of Defendant General Accident Insurance Company, and for the reasons stated in the accompanying opinion, Defendant's motion for summary judgment is DENIED. BY THE COURT, Samuel L. Andes, Esq. 525 North 12th Street Lemoyne, PA 17043 Attorney for Plaintiff Douglas B. Marcello, Esq. 305 North Front Street Post Office Box 999 Harrisburg, PA 17108-0999 Attorney for Defendant s/J. Wesley Oler~ Jr. J. Wesley Oler, Jr., J. 8